Hundreds of Post Offices in the North East could close as a result of the Government's decision to end the Post Office card account , claims a leading Liberal Democrat in the North East.
The card account is used by nearly five million elderly people each week to collect their state pension through post office branches.
But the government have announced that the card account will be scrapped by 2010. Elderly people will have to open bank accounts to receive their pensions instead. It is widely felt that the resulting huge loss in trade to post offices will result in many closing.
"From 2003 to 2010, post office branches will have been paid £1 billion to handle the post office card account," said Dr Jonathan Wallace who is a councillor in Blaydon constituency on Gateshead Council. He is also a member of the Liberal Democrats' Parliamentary Trade and Industry Team.
"In 2010 that money will end. That's great news for the big banks which will then be paid by the government to handle pensioner's money.
"But it is a disaster for post office branches, many of which are struggling to survive. And it is an even bigger disaster for the pensioners themselves.
"The inevitable result of this government decision is that pensioners will pay more to get their pensions. Post Offices are far more accessible than banks. In many areas, where there are no bank branches, the only cash machines in a community charge £1.50 and sometimes more to use.
"So pensioners will be out of pocket and post office branches will see a loss of trade with many closing down. The government decision to end the card account is callous and deeply regrettable and should be reversed."
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